Martin Marmy: „Road transport is vital for real economic growth”

Interview with the Secretary General of the International Road Transport Union (IRU)

At the beginning of 2012, we conducted a dialogue with the IRU Secretary General, Martin Marmy, about 2012 for road transport world.

Dear Mr. Marmy, please take a look at the last IRU General Assembly in Geneva, on 4-5 November 2011, where elections were held for key positions.

IRU is a democratic organization, governed primarily by its members, who re-elected, of course, the head of the organization, its Chairman, Mr. Janusz Lacny. IRU members are those who decide the direction, strategy and positions that the organization adopts it on all issues. All major issues were discussed in November, in Geneva, where each IRU member could support his point of view and judgments were subject to a democratic majority vote.

The world is in crisis. What are the challenges of 2012?

IRU members, under aegis of the General Secretariat, will endeavor to further improve road transport performance. Without road transport, the whole economy stops. Today, 95% of road transport consists ofPME(note: petites et moyennes Enterprises, i.e small and medium enterprises). SMEs provide 85% of private sector jobs, they are no longer a merely means of transport.

Road transport became an instrument of production and distribution, essential for real economic growth by linking each company to each market worldwide. It is the only means of transport complementary to all the other, available everywhere, always and for everyone and the only better distribution way of resources and to unite people. Given this vital role in economic growth and success of each, any penalty is a greater penalty for the whole economy and society.

Sometimes, we think that institutional dialogue partner does not communicate very well.

The inability of decison makers to communicate with SMEs in road transport and their professional organizations disconnects them from the concrete realities of the world where we work and prevents them from having success. Even when listened, the best proposals of SMEs are rarely understood. Authorities forget that their business objectives and results, especially in the context of sovereign debt crisis, should aim at ensuring economic growth by improving the situation of SMEs and living conditions.

It is therefore crucial for IRU members to strengthen cooperation with national authorities. Any penalty for road transport is, in fact, a measure of incitement to business relocations. And who says relocation, says decline in economic activity within the national territory, thus increasing unemployment and economic downturn.

In 2001, the European Council met in Laeken, committed the EU to become a stability factor in the world. It’s been ten years now, and the European countries world is profoundly unstable. How does crisis influence road transport?

The situation of instability is largely the result of the huge sovereign debt of countries, particularly the most industrialized one. In transport, debt led to massive use of public funds by severely indebted railway undertakings, which are highly deficient for a long time to create mega-undertakings, which make unfair competition on the transport market and endanger private enterprises from road transport.

What is the biggest current problem of the EU?

The problem is that the EU has become a major market in which you do not produce, but you consume and buy on credit. Yet, even worse than that: countries’ public services and citizens of this vast region are now living on credit.

„Rail transport is not only privileged, but the massive use of public funds translates into a great debt of states, threatening not only road transport companies, but also the financial system in general.”

Financially, how are the European Transports?

In 2005, the Organization for European Cooperation and Development (OECD) showed that the fees for railway infrastructure did not cover all infrastructure costs but in only three EU Member States. It is clear that rail transport is not only financially privileged, but the massive use of public funds is reflected especially by high indebtedness of states, threatening not only healthy and profitable private enterprises in road transport, but also the financial system in general .

If the significant role of road transport in the growth and successful development of real economy is not recognized, unfortunately, by all decision makers, this major and vital role of road transport is perfectly known by public organizations of the railways. 55% of the turnover of the SNCF (France) freight division comes from its road transport activities …

… real economy – speculative economy …

Yes. Since the beginning of industrialization, almost 250 years ago, until today, and as it’s happening today in the BRIC countries (Brazil, Russia, India and China), experience shows that all investments in the real economy and enterprises producing goods and non-subsidized services, such as those from road transport, have always been systematically at the heart of providential growth and socio-economic progress that managed to expand around the globe.

If we compare the importance given to road transport in recent years by policy makers in OECD and the one given by the so-called „emerging” countries, in particular BRIC, we see obvious differences, both in terms of economic growth, but also in the registrations number of new trucks, complaining of a 50% decrease for the OECD and an increase of 50%, 15%, 40% and 80% for the four BRIC countries. In other words, the close correlation that exists between a dynamic road transport sector and a successful economic growth is undeniable.

„It is time that governments apply the control of taxation and fair taxes and use of massive subsidies granted to public transport.”

It is really time for governments to implement necessary measures, including control of taxation and fair taxes, as well as effective use of massive subsidies granted to public transport, so that each activity, each means of transport on the market has equal opportunities. Such decisions would not only have the benefit to promote the real economy growth, but would allow achieving the eight goals of the UN Millennium Development.

In business and diplomacy there is the hypothesis that Asia will become the world center of trade. On the other hand, Prime Minister Putin makes reasonable efforts to found Eurasian Union. Do you provide a radical change on the trade and transport routes map?

IRU has been working for 30 years hand in hand with Central and Eastern Asian countries, especially to revive the Silk Road, which crosses regions in which more than two thirds of the world live, produce and trade, where China became the „world factory”. This close cooperation of IRU with national governments and regional organizations of Eurasia has already resulted in facilitating trade and international transport on the continent, eliminating possible barriers between international trade.

This cooperation allows all Asian countries to benefit from the positive effects of globalization, particularly by removing from insulation landlocked countries, due to road transport. IRU works directly with Asian countries for simplification and harmonization of formalities which govern the international carriage within Eurasia and hand in hand with the customs union. Those 60 years of experience in facilitating and using the best tool production – road transport- are not only recognized but also put into practice.

The fundamental challenge, especially for highly industrialized countries such as the OECD, will be to achieve much, much more, much, much less.

What would be the future challenges for IRU members in Europe and around the world?

The fundamental challenge, especially for highly industrialized countries such as the OECD, will be to achieve much, much more, much, much less. Especially on railways, which have unjustified and often uncontrolled subsidies for too long and everywhere, effectively more than questionable, whose financial impact on the growth of sovereign debt must not be shown.

There are lots of opportunities that we can benefit, by working hand in hand with governments. The latter should be aware that private road transport is the only means of transport that is a very profitable source of revenue for states. Road transport is the only means of transport that pays many taxes, fees, premiums and excise, unlike other means of transport that receive significant tax breaks and subsidies, which result in higher growth of sovereign debt already abysmal.

For all these reasons, it is imperative for decision makers to promote and finally facilitate the vital role of road transport as an engine of progress, to promote that „made in …”, of growth, prosperity and stability of modern society of tomorrow, working together for a better future.